AT A CEREMONY in Stockholm on December 10, the King of Sweden presented the 1980 Nobel Prize for literature to a virtual unknown: the Polish poet, Czeslaw Milosz. The award comes at a crucial moment in Poland's history, and this is not the first time it has sparked controversy.

Until now the deliberations of the literature committee at the Swedish Academy, which makes the award, have always remained secret; but recently in Stockholm, one senior member of the committee revealed to British journalist Peter Lennon some of the biases that affect their judgment.

EVERY THURSDAY afternoon six elderly gentlemen gather in the library of the Swedish Academy behind the Royal Palace in Stockholm's old town. The aisles and reading rooms of this 18th-century building have the sweet odor of sanctity of a monastery, or a place where rare books are lovingly kept. For three hours, addressing each other courteously as "Mister" to prevent the intrusion of passion, they debate to whom they will that year award $212,000.

They are helped in their deliberations by a row of new, brightly jacketed books from all over the world; these are laid out by the librarian around the edge of a long oblong table, rather like a colorful, intellectually edible smorgasbord. Their decision will not only result in some novelist or astonished poet suddenly receiving a formidable tax-free increase in his income, but publishers from practically every corner of the globe will be clamoring overnight to translate or republish his work.

Having made some cautious progress with this devastating decision, they then ritualistically repair, at 8 o'clock, to a medieval restaurant nearby, Den Gyldene Freden (The Golden Peace). There, in a private suite on the first floor, they abandon formality, address each other with the familiar du, and lay into the rolled reindeer on toast and parfait of cloudberry.

The intimate room is dominated by a 10-foot-high kakelugn, a curved tiled stove. Here the doyen of the group, 96-year-old Dr. Anders Osterling, has even been known to warble a few bars of an old Swedish song standing by the upright piano. The Nobel literature committee never mixes business with the cloudberries.

These men, all 65 or over, are Swedish poets and critics; it is their job to present a short list of five Nobel candidates to the Swedish Academy every autumn from an annual list of about 150. Although their choice is in theory not binding on the Academy, in practice the Nobel winner is almost invariably among the five and very frequently their recommended front-runner.

The skeptic may find it strange that the task of deciding each year who has produced the world's most outstanding work of literature should fall to a group of people living by the frozen fringes of Europe and not native to one of the great international languages, although they are all indisputably highly cultured -- not to mention forcibly well-read -- gentlemen. But that is the bizarre and now inescapable consequence of the will of a man who was himself pretty bizarre, Alfred Nobel, the Swedish-born inventor of dynamite. When the will was made public in 1896, the Academy at first refused to become involved with this potentially eternally acrimonious task. But by 1901 they had been talked into it. For 80 years they have been trapped in this chore.

THE WORK of scouring the world for candidates and assessing their merits goes on the whole year round. Every November the Secretary of the Academy, Professor Lars Gyllensten, sends out letters to thousands of qualified individuals -- members of similar world academies, university scholars and former laureates -- and invites them to submit nominations. In addition a large number of experts, Swedish and foreign, are regularly called on to submit assessments of writers -- for a generous fee. Generally a candidate would have to have been translated into one of the major languages already before he would be considered, but in the case of an obscure poet like Odysseus Elytis, the Greek, or the Spanish poet Vinvente Aleixandre, the committee would commission extra translations. All six of them are proficient in two or three languages; some make a point of travelling regularly to discover candidates for themselves.

The task of assessing 150 writers annually is not as daunting as it may seem. There is a large consensus of world opinion of who is of Nobel stature and the great majority of the names have been on the list for years. No writer has won without having been listed for at least three or four.

The academicians are, in theory, a severely tightlipped lot. No government authority can interfere with their deliberations. They say they reject pressure from embassies, national or international organizations, and ignore "expressions of opinion in the press." They are never, they claim, influenced by political considerations. The "investigations, the nominations, the deliberations and the voting of individual members are secret; the decisions are final and without appeal."

But I discovered in Stockholm recently that there was one surprising way of dissolving the rigid discretion of the academicians. This was the repeated and energetic application of two words: Graham Greene. IT IS NOT JUST THAT these worthy and kindly men have for decades passed over Graham Greene: they squirm visibly at the reminder that for four-score years the Academy has made a mess of its awards to English writers.

Every committee is essentially dominated by a minority of powerful personalities; the problem was to discover who might be responsible for withholding, so to speak, the power and the glory from Graham Greene. Who dominated with his verve, passion, stubbornness and literary crusading spirit?

Stockholm is a small city, and while the private dining rooms at Den Gyldene Freden do not facilitate the passage of secrets, the deep need of honest men to justify themselves in private does. Astute observers in Stockholm will bet that two men dominate the deliberations: Dr. Artur Lundkvist and Osterling.

Lundkvist is 74. The rules appoint a committee member for three years, but he may be reelected. Lundkvist has been on the committee for 12 years. Osterling, you remember, is 96. By the same process he has been on the committee since 1919.

Put simply, Lundkvist is believed to exercise the strongest influence over the choice of novelists; and the presence on the Nobel list in recent years of some startlingly obscure poets -- Spanish, Greek, Yiddish and Polish -- is due largely to the eclectic scholarship of Osterling.

Not even its most severe critics would suggest that there is any corruption or collusion within the Academy, but they do not rule out the possible existence of a kind of spiritual understanding between Osterling and Lundkvist which not only accounts for the presence of the obscure Nobel bards, but also perhaps the absence of Graham Greene. Many in the Swedish literary world suspect that Lundkvist does not admire Greene.

I went to see him.

Artur Lundkvist, a man of extraordinary energy, with more than 50 books to his credit, is a formidable linguist, critic, translator and champion of international writers. Tall, with an erect and courteous bearing, dressed with formality, the first impression is of a metropolitan aristocrat. But his boots are the boots of a peasant.

Even in mild weather he wears not sensible boots, but stubborn boots; boots with tough, upturned toecaps. He was born on a tiny farm in the north of Sweden and left school at the age of 10. For the past 50 years, partly perhaps because he is childless, he, and later his wife Maria Wine, a Danish poet, have scoured the world for young, and not so young, talent.

Lundkvist is almost entirely self-educated. He told me how he learned English alone by the unnecessarily painful process of translating Virginia Woolf's Orlando. He told me how as a teen-ager he had the first typewriter ever seen in his village and began to turn out short stories for the local newspaper at 16; how he went on to learn, with his Scandinavian tongues, another handful of languages; how he rushed to Paris to get the first edition of Ulysses hot off Sylvia Beach's presses, but found Joyce very difficult and has to this day "never penetrated" Finnegans Wake. He told how he translated Faulkner (Nobel, 1949) in the '30s, and actually went to Australia to seek out Patrick White (Nobel, 1973) almost before the Australians had heard of him.

"Why didn't you give the prize to Graham Greene?" I asked suddenly.

This question brought a distinct pause to Lundkvist's worldwide gallop. After a moment's silence he said: "It does not depend on me. He must get a majority; he has not got it." Perhaps because he had not quite lost the momentum of his literary trot, Lundkvist, uncharacteristically for a discreet Nobel academician, decided to give a reason: "Thirty years ago I was very impressed by him," he said. "I thought The Power and the Glory was a very good book. But I think his work has declined."

"But Steinbeck (1962) got it 23 years after he wrote his last good book, The Grapes of Wrath, and Sholokhov (1965) wrote And Quiet Flows the Don nearly 40 years previously."

"I know. But Greene is too popular," he said sulkily. "And anyway he doesn't need the money."

"That cannot be a condition," I said. "Most Nobel prize winners are too well-known already and don't need the money."

"Well, personally, I will not vote for him," Lundkvist said exasperatedly.

"The criticism of Nobel winners is that you give to established writers who have money and authority more money and authority."

"Beckett needed the money."

"In 1969? He did not."

"It's true he gave it away," Lundkvist admitted. "But Patrick White was really only known to English readers, and now he is known worldwide. The prize certainly helps poets."

"One weakness of your committee is that you are mostly elderly men and there is danger your tastes would be inflexibly bound to the literary traditions of your youth."

"Lars Forssell is a young man (he is 52), and although Dr. Osterling is 96 he is very flexible still in his reading. He is always discovering young writers. For this work you can't just jump in as a young man and try to cover this vast area. It takes a lifetime of reading."

"Do you insist that you are never influenced by political considerations. In the case of Solzhenitsyn (1970) for example?"

Lundkvist denied that politics ever influenced them, but there seemed to be a contradiction in what he said later about Solzhenitsyn. "I don't think Solzhenitsyn is a very big artist. He writes like Tolstoy. But we helped a man in danger who had important things to say which he was able to say in the world later. There ws a certain balance with the prize to Sholokhov (five years earlier). He was the official Soviet favorite. But And Quiet Flows the Don in the '30s was the only thing of importance he wrote. His later work was not at all up to standard."

Another criticism of the Nobel committee, which always claims to be exclusively concerned with artistic evaluation, is the "geographic factor": one year a European, another a South American.

"We try to spread it of course," Lundkvist said. "You can't give it to the same country two years running."

"Do you insist that you were not influenced by the Polish strike in giving the prize to a Polish poet this year?"

"It would have been quite impossible to have been influenced. He was already on our list for three or four years, and was put on the final short list in May -- long before the strike. The Polish strike caused some of us to hesitate, but it would have been just as impossible to reject him because of those events."

But Lundkvist had earlier admitted that any "new factor" would tilt the balance in favor of an author already on their short list. The appearance of a new work by the author, for example, but also any other "appropriate factor," he hinted. The Polish strike could hardly have failed to concentrate the minds of the academicians on their Polish candidate.

Lundkvist was ready to admit the possibility of a strong personality dominating the committee, at least in the past. "The poet, Saint-John Perse [France, 1960] got the prize because of Dag Hammarskjold," he said, "Hammarskjold had very great influence on the committee."

There is no limit to Lundkvist's ambitious search for writers. "Black Africa has been producing much good work. I have been there five or six times recently. There are some black African nominations now."

"Can we expect a black Nobel prize winner in the next few years?"

"It may happen."

"There is a more fundamental criticism of your activities: you claim to award the outstanding world writer, but how can you assess the merit of the literature of countries whose culture is totally foreign to you? Countries like China or India?"

"There are some good Indian writers, in Hindi for example, but they are not, so far, up to the international standards we must maintain. They are primitive cultures, and I don't think somehow they are capable of developing in a global way."

"But you conquered literature from a peasant environment."

"That's different; I studied the classics," he said. Then he began to look glum and uncertain. "But," he continued, cheering up, "There is Japan. We gave the prize to a Japanese, Yasunari Kawabata, in 1968. Japan is a country which has developed a quality in literature comparable to ours, because it is an industrialized, advanced society,"

"They are westernized, you mean. You are actually imposing western, white, indeed Christian, esthetic values?"

Lundkvist began to ruminate on his task and did not seem to be arriving at an altogether satisfactory conclusion. "Of course," he said, "these countries have a cultural tradition that it is not possible for us to evaluate. It could not be otherwise."

Then he burst out: "It is true we are not up to the task. But who is? Do you think the English would do it better?"

He then said that he does not always have things his own way. Perhaps it was the melancholy of the early Swedish twilight that was getting to him. We had forgotten to switch on the lights and in the rapidly darkening room, the bald busts of former academicians shone with a pale lugubrious light. Or perhaps it was that an honest man finds it intolerable to be committed to life-long secrecy about matter and opinions which engage him passionately.

"We should never have given the prize to the two Swedish writers," he confided. In 1974 Eyvind Johnson and Harry Martinson, themselves members of the Academy, shared the Nobel prize. This created an uproar in Sweden; both the writers and the Academy came under intense criticism.

"Of course they did not take part in the deliberations once their names came on the short list. But it was wrong, somehow," Lundkvist said. "I was very much against it. I told them: 'Don't accept the prize. It will only make you unhappy; you will get great unhappiness because of it.' And indeed both of them died shortly after, earlier than they should have, because of the prize perhaps."

THE OTHER central figure, Osterling, the man who nurses the aspirant poets, was ill. He could only manage a brief conversation. He had been there when the prize was awarded to Anatole France in 1921 and championed the controversial award to Yeats in 1923.

The British got a bit peeved about this award and accused the Nobel committee of playing politics. The Daily Telegraph of the time commented: "The award to Mr. Yeats comes pat on the establishment of the Irish Free State. There is no suggestion of a plot against the integrity of the British Empire," the writer consoled his readers, "but I conceive that an author belonging to a recently insurgent and sufficiently well-advertised nationality starts in the competition with at least three marks to his credit"

But Osterling had one thing on his mind: "It is a pity England has been so neglected," he said. "I regret Graham Greene never got the prize. His name would have adorned our list very well."

It began to appear that few academicians are indifferent to Greene's absence from the Nobel list. The next day I spoke with the poet Lars Forssell, who is one of the youngest members of the Academy. The youngest is a woman, Kerstin Ekman, aged 47, who began life writing brilliant detective stories but then developed into a considerable novelist.

Forssell was, and to an extent still is, a kind of enfant terrible of Swedish literature. He says, apologeticaly, that his poetry is "very hermetic." But every 10 years or so he breaks out and does something frivolous. The night before I met him, a cabaret show, with all the songs written by him for Sweden's best-known pop singer, Lill-Babs Svensson, had opened to enchanted reviews.

I do not know if his air of crumpled weariness had something to do with the previous night's celebrations, but he looked, and his tone of wry humor suggested, that here was a man upon whom respectability had been thrust, and who had not quite got the hang of it. His early artistic education was on the Left Bank in Paris where he was a disciple of the cabaret artist and one-time banned French novelist, Boris Vian. While Forssell is not on the literature committee, he has been one of the voting academicians for the past eight years.

I put it to Forssell that the dilemma of the Academy was that they couldn't stop giving the Nobel prizes even if they wanted to. "You can't change the terms of a man's will."

"I can't see how it could be done," he agreed. "The whole idea of giving the best writer the prize when most writers are incomparable is pretty strange from the beginning. Another problem we have is with the word 'ideal' or 'idealistic' writer, which the will cites. You know in Nobel's day idealism really meant something, something terribly Germanic, texts about the beauty of life and the strength of man. That's why they never gave it to Ibsen," he laughed. "They couldn't because he wrote about syphilis. Nobody mentions idealism any more.

"The only thing I can say for the fact that a small group of Swedish people select the Nobel winner is that I have been on other juries, international juries, and they are victims of tremendous commercial pressure. I was for instance on a film jury with Pasolini, in Berlin . . . , and the intrigue, the horse-trading and the changing of votes that went on. 'You vote for this film and I'll vote for that actress.' Especially now that the book trade has turned into an international industry I think it would be worse to have an international jury. We don't have that tremendous commercial pressure."

"Do you think," I asked, "that with modern communications putting the literature of absolutely every country within your reach you may have to adopt some rules which might restrict you to a less hopeless task than taking in the entire universe?"

"We might" he said. "It's obvious you can't cover the entire world." But this rumpled, reluctantly academic poet did not seem too bothered either way. In fact, Forssell did not seem to be listening; he had something else on his mind.

"You know," he said "I think it was a great mistake that in the '50s they didn't give the Nobel Prize to Graham Greene."